[Introduced January 9, 2003; referred to the Committee on
Economic Development; and then to the Committee on Finance.]

____________

A BILL to amend and reenact section nine-e, article six, chapter
twelve of the code of West Virginia, one thousand nine hundred
thirty-one, as amended, relating to increasing the amount
available from the consolidated fund as a revolving loan to
the West Virginia economic development authority for the
purpose of promoting certain business or industrial
development projects.

Be it enacted by the Legislature of West Virginia:That section nine-e, article six, chapter twelve of the code
of West Virginia, one thousand nine hundred thirty-one, as amended,
be amended and reenacted to read as follows:ARTICLE 6. WEST VIRGINIA INVESTMENT MANAGEMENT BOARD.

(a) The Legislature hereby finds and declares that the
citizens of the state benefit from the creation of jobs and
businesses within the state; that a business and industrial
development loan program provides for economic growth and
stimulation within the state; that loans from pools established in
the consolidated fund will assist in providing the needed capital
to assist business and industrial development; and that time
constraints relating to business and industrial development
projects prohibit duplicative review by both the board and the West
Virginia economic development authority board. The Legislature
further finds and declares that an investment in the West Virginia
enterprise capital fund, LLC, of moneys in the consolidated fund as
hereinafter provided in this section will assist in creating jobs
and businesses within the state and providing the needed risk
capital to assist business and industrial development. This
section is enacted in view of these findings.(b) The board shall make available, subject to cash
availability, in the form of a revolving loan, up to one hundred
fiftyseventy-five million dollars from the consolidated fund to
loan the West Virginia economic development authority for business
or industrial development projects authorized by section seven,
article fifteen, chapter thirty-one of this code and to consolidate existing loans authorized to be made to the West Virginia economic
development authority pursuant to this section and pursuant to
section twenty, article fifteen, chapter thirty-one of this code
which authorizes a one hundred fifty million-dollar revolving loan
and article eighteen-b, chapter thirty-one of this code which
authorizes a fifty million-dollar investment pool: Provided, That
the West Virginia economic development authority may not loan more
than fifteen million dollars for any one business or industrial
development project. The revolving loan authorized by this
subsection shall be secured by one note at a variable interest rate
equal to the twelve-month average of the board's yield on its cash
liquidity pool. The rate shall be set on the first day of July and
the rate shall be adjusted annually on the same date. The maximum
annual adjustment may not exceed one percent. Monthly payments
made by the West Virginia economic development authority to the
board shall be calculated on a one hundred twenty-month
amortization. The revolving loan shall be secured by a security
interest that pledges and assigns the cash proceeds of collateral
from all loans under this revolving loan pool. The West Virginia
economic development authority may also pledge as collateral
certain revenue streams from other revolving loan pools which
source of funds does not originate from federal sources or from the
board.The outstanding principal balance of the revolving loan from
the board to the West Virginia economic development authority may
at no time exceed one hundred three percent of the aggregate
outstanding principal balance of the business and industrial loans
from the West Virginia economic development authority to economic
development projects funded from this revolving loan pool. This
provision shall be certified annually by an independent audit of
the West Virginia economic development authority financial records.(c) The interest rates and maturity dates on the loans made by
the West Virginia economic development authority for business and
industrial development projects authorized by section seven,
article fifteen, chapter thirty-one of this code shall be at
competitive rates and maturities as determined by the West Virginia
economic development authority board.(d) Any and all outstanding loans made by the board, or any
predecessor entity, to the West Virginia economic development
authority shall be refunded by proceeds of the revolving loan
contained in this section and no loans may be made hereafter by the
board to the West Virginia economic development authority pursuant
to section twenty, article fifteen, chapter thirty-one of this code
or article eighteen-b of said chapter.(e) The trustees of the board shall bear no fiduciary
responsibility as provided in section eleven of this article with specific regard to the revolving loan contemplated in this section.(f) Subject to cash availability, the board shall make
available to the West Virginia economic development authority from
the consolidated fund a nonrecourse loan in an amount up to twenty-
five million dollars for the purpose of the West Virginia economic
development authority making a loan or loans, from time to time, to
the West Virginia enterprise advancement corporation, an affiliated
nonprofit corporation of the West Virginia economic development
authority. The respective loans authorized by this subsection by
the board to the West Virginia economic development authority and
by the West Virginia economic development authority to the West
Virginia enterprise advancement corporation shall each be evidenced
by one note and shall each bear interest at the rate of three
percent per annum. The proceeds of any and all loans made by the
West Virginia economic development authority to the West Virginia
enterprise advancement corporation pursuant to this subsection
shall be invested by the West Virginia enterprise corporation in
the West Virginia enterprise capital fund, LLC, the manager of
which is the West Virginia enterprise advancement corporation. The
loan to West Virginia economic development authority authorized by
this subsection shall be nonrevolving and advances thereunderunder
the loan shall be made at times and in amounts as may be requested
or directed by the West Virginia economic development authority, upon reasonable notice to the board, the loan authorized by this
subsection is not subject to or included in the limitations set
forth in subsection (b) of this section with respect to the fifteen
million dollar limitation for any one business or industrial
development project and limitation of one hundred three percent of
outstanding loans and may not be included in the revolving fund
loan principal balance for purposes of calculating the loan
amortization in subsection (b) of this section. The loan
authorized by this subsection to the West Virginia economic
development authority shall be classified by the board as a
long-term, fixed income investment, shall bear interest on the
outstanding principal balance thereof at the rate of three percent
per annum payable annually on or before the thirtieth day of June
of each year and the principal of which shall be repaid no later
than the thirtieth day of June, two thousand twenty-two, in annual
installments due on or before the thirtieth day of June of each
year. whichThe annual installments shall commence no later than
the thirtieth day of June, two thousand three, in annual principal
amounts as may be agreed upon between the board and the West
Virginia economic development authority. and whichThe annual
installments need not be equal. The loan authorized by this
subsection shall be nonrecourse and shall be payable by the West
Virginia economic development authority solely from amounts or returns received by the West Virginia economic development
authority in respect of the loan authorized by this subsection to
the West Virginia enterprise advancement corporation, whether in
the form of interest, dividends, realized capital gains, return of
capital or otherwise, in all of which the board shall have a
security interest to secure repayment of the loan to the West
Virginia economic development authority authorized by this
subsection. Any and all loans from the West Virginia economic
development authority to the West Virginia enterprise advancement
corporation made pursuant to this subsection shall also bear
interest on the outstanding principal balance thereofof the loan
at the rate of three percent per annum payable annually on or
before the thirtieth day of June of each year shall be nonrecourse
and shall be payable by the West Virginia enterprise advancement
corporation solely from amounts of returns received by the West
Virginia enterprise advancement corporation in respect of its
investment in the West Virginia enterprise capital fund, LLC,
whether in the form of interest, dividends, realized capital gains,
return of capital or otherwise, in all of which the board shall
have a security interest to secure repayment of the loan to the
West Virginia economic development authority authorized by this
subsection. In the event the amounts or returns received by the
West Virginia enterprise corporation in respect of its investment in the West Virginia enterprise capital fund, LLC, are not adequate
to pay when due the principal or interest installments, or both,
with respect to the loan from the West Virginia economic
development authority and, as a result thereof, the West Virginia
economic development authority is unable to pay the principal or
interest installments, or both, with respect to the loan authorized
by this subsection by the board to the West Virginia economic
development authority, the principal or interest, or both, as the
case may be due on the loan made to the West Virginia economic
development authority pursuant to this subsection shall be deferred
and any and all such past-due principal and interest payments shall
promptly be paid to the fullest extent possible upon receipt by the
West Virginia enterprise advancement corporation of moneys in
respect of its investments in the West Virginia enterprise capital
fund, LLC. The trustees or the board shall bear no fiduciary
responsibility as provided in section eleven, article six, chapter
twelve of this code with regard to the loan authorized by this
subsection.